Backpacker tax decision still treats tourism industry as a cash cow

Published on : Tuesday, September 27, 2016

The Tourism & Transport Forum Australia (TTF) has said the decision to reduce the proposed 32.5 per cent backpacker tax to 19 per cent is a step in the right direction to fixing the problem but the Government’s blatant cash grab through the hiking of the Passenger Movement Charge is unacceptable to the industry.

“It is outrageous situation that the Federal Government continues to view the tourism industry as a cash cow,” said Margy Osmond, TTF CEO.

“While I am very disappointed that the Federal Government wishes to push ahead with the backpacker tax, 19 per cent is a hell of a lot better than 32.5 per cent. TTF will be continuing our dialogue with other political parties as the legislation for this tax is introduced to the Parliament.

“Industry has been completely blindsided by this decision to increase the PMC by $5 – a 9 per cent hike in the rate. At no point was it flagged in any discussions in which we took part and is a bitter disappointment that we’ve been slapped with this tax hike on every traveller – Australian or international visitor – heading overseas.

“I want to make it quite clear that TTF, representing the industry, has been steadfast in our opposition to any increase in the Passenger Movement Charge. Before the Federal Election, the first plank of our election manifesto was the demand that all sides of politics continue to freeze the PMC at the current rate of $55.

“We recognise that the Federal Treasurer Scott Morrison has inherited this decision from his predecessor and that it has been a difficult issue for Government. However, any need to make revenue targets has been set by the Government not industry.

“We do acknowledge that the Government has picked up some of TTF’s suggestions. The revised backpacker tax package does contain some positives for the industry. The extension of the age limit for working holiday makers from 30 to 35 and the reduction of the cost of working holiday visa by $50 to $390 is welcome.

The relaxation of some of the employment restrictions that will now allow backpackers to continue to work for the same employer for 12 months but in different states or territories in Australia is also positive.

“The allocation of $10 million for the industry to work with Tourism Australia to increase the working holiday makers to Australia following the more than 43,000 decline we’ve experienced over the past three years is something that TTF has been calling for as part of this review.”